U.S. stocks bounced back sharply on Monday, recovering a portion of last week's losses even as renewed tensions between Iran and Israel briefly pushed oil prices higher. Investors appeared willing to look past geopolitical concerns and focus instead on bargain-hunting in technology and artificial intelligence stocks, which had been heavily sold during Friday's market rout.

The strongest recovery came from the technology sector. The Nasdaq Composite rose more than 1%, while the S&P 500 and the Dow Jones Industrial Average also moved higher. Semiconductor stocks led the rally, with the Philadelphia Semiconductor Index surging 6.8%, putting it on track for its biggest one-day gain in more than a year. Investors returned to AI-related companies after a sharp selloff erased hundreds of billions of dollars in market value across the sector last week.

Friday's decline had been triggered by stronger-than-expected U.S. employment data, which increased concerns that the Federal Reserve may need to keep interest rates higher for longer or potentially raise them again later this year. At the same time, investors took profits in many AI stocks after an extraordinary rally that had pushed valuations to record levels. The result was a more than 4% plunge in the Nasdaq, its worst single-day performance in months.

Over the weekend, futures markets initially pointed to further losses as fighting between Iran and Israel intensified. Oil prices jumped on fears that a broader regional conflict could disrupt energy supplies and increase inflationary pressures worldwide. However, sentiment improved after Iran announced that it had concluded its latest round of military operations against Israel. As fears of immediate escalation eased, oil prices gave back much of their earlier gains and Treasury yields also retreated from session highs.

Investors are now shifting their focus to several important events later this week. The most closely watched will be the release of the U.S. Consumer Price Index (CPI) report on Wednesday, which will provide fresh insight into inflation trends. A higher-than-expected inflation reading could strengthen expectations for additional Federal Reserve tightening, while softer data could support hopes for stable interest rates.

Another major event attracting investor attention is the anticipated IPO of SpaceX. The offering is expected to be one of the largest public listings in history and could become an important test of investor appetite for high-growth technology and AI-related companies. Combined with inflation data and ongoing geopolitical developments, the SpaceX debut could play a significant role in determining market direction for the remainder of the week.

For now, Monday's rebound suggests that investors remain confident in the long-term growth story surrounding artificial intelligence, even as concerns about interest rates, inflation, and global conflicts continue to create short-term volatility across financial markets.